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Samsung is reportedly preparing a preemptive strike on the iPhone 5, looking to ban sales in South Korea and other international markets (image: rumored picture of iPhone 5 -- UNCONFIRMED).

Apple claims Samsung is infringing on its OS technology and design; Samsung claims Apple's devices infringe on its wireless patents (left: Galaxy Tab 10.1, right: iPad 2).  (Source: Gadgets and Gizmos)
Samsung looks to get the jump on Apple in the latest round of lawsuits

An unnamed Samsung Electronics Comp., Ltd.'s (SEO 005930) senior executive was quoted in The Korea Times as stating that "his" company planned to go on the offensive in its legal battle against Apple, Inc. (AAPL), suing in multiple regions to try to ban sales of Apple's upcoming iPhone 5.

I. Samsung Goes on the Offensive

The report quotes the male senior executive as saying, "Just after the arrival of the iPhone 5 here, Samsung plans to take Apple to court here [in S. Korea] for its violation of Samsung’s wireless technology related patents. For as long as Apple does not drop mobile telecommunications functions, it would be impossible for it to sell its i-branded products without using our patents. We will stick to a strong stance against Apple during the lingering legal fights."

It was Apple who launched the patent war, by suing to ban Samsung sales in the U.S., one of the world's most lucrative phone markets.  But it was Samsung who escalated the patent dispute, suing Apple in Germany, Japan, and South Korea.

The report in The Korea Times largely ignores this distinction, inferring that Samsung is changing gears from a defensive to an offensive role.  It quotes the executive as saying; "We are taking different tactics since we are quite confident."

More correctly, Samsung indeed may be altering its strategy, but it's likely instead trying to push for faster rulings.  For example its case in Germany was filed before Apple's, but still is yet to be resolved, while the Apple one 
wrapped up last week.  With the iPhone 5, Samsung likely wants to sue Apple before it can be hit with new lawsuits regarding the Galaxy S II.

II. From Friends to Enemies

The Android phone maker enjoys a complicated relationship with Apple, Inc. (
AAPL), much like Android OS-creator Google Inc.'s (GOOG) relationship with Apple.  In addition to its discrete devices units, Samsung is also one of the largest component producers, making memory, CPUs, and screens for small portable devices.

Apple has long been one of its largest clients.  Samsung is Apple's primary supplier of NAND flash memory, the storage chips found inside the iPad and iPhone products.  Samsung also has manufactured Apple's CPUs.  Early iPhone contained CPUs designed directly by Samsung.  In recent models, Samsung's role as chip designer has blurred as Apple has begun branding its chips and contributing substantially to the final design -- though Samsung is still thought to be playing a key role in design.

However, the pair's relationship has been 
stressed to the breaking point by the fact that Samsung is currently the world's top maker of Android smartphones and tablets, vying with Apple for the top spot in global sales.  As Android smartphones have recently begun to outsell the iPhone 5-to-2 and Android tablets creep towards the once seemingly insurmountable iPad sales lead, Apple has sued [1][2][3][4][5][6][7][8] the world's top Android manufacturers claiming that they have stolen its patented designs and technology.

Samsung CEO Choi Gee-Sung comments, "Apple is Samsung’s biggest customer. Hewlett-Packard (HP), Nokia and Sony were Samsung’s previous big clients, however, Apple is now a primary one. From our perspective, we are not entirely happy (about the litigations)."

III. What Does Apple Claim?

Apple has been particularly pointed in its words for Samsung.  In its first lawsuit against its estranged supplier, it writes, "Rather than innovate and develop its own technology and a unique Samsung style for its smart phone products and computer tablets, Samsung chose to copy Apple's technology, user interface and innovative style in these infringing products."

Much of the technology intellectual property involved in the suit deals with the core Android OS -- for example the way touch works in certain phone applications.  However, Apple, thus far, has declined to directly sue Google instead targeting the top manufacturers who use Android OS.  

Additionally Apple claims that Samsung's smartphones copy its patented design on the iPad and iPhone.  

The "fat iPad" design patent (
D504,889 in the U.S.) was filed in 2004 and depicts a device with no face buttons (unlike the iPad which has one face button) and only a power button on the edges (no mute button or volume rockers like on the iPad).  The device was also much thicker than the iPad, based on the drawings contained in the filing.  As a result the design looks relatively little like the iPad or the Galaxy Tab (Samsung's tablet), beyond the fact that both are "minimalist" rectangular tablets.

By contrast the iPhone design patents (
D618,677 and D593,087 in the U.S.), which were filed shortly after the release of the iPhone 4 and iPhone (original), respectively, look much more like the respective iPhone models at the time.

Substantial visual differences can be found between the patent and Samsung's best-selling Galaxy S/S II smart phones, the primary target of the lawsuit on the smartphone front.  The Galaxy phones have at least three physical face buttons and feature a curvier bottom than the iPhone.  On the other hand if you ignore the side face buttons, the phones do look somewhat alike, in that both have a small speaker slit above the screen and a home button beneath it.

Probably the most compelling evidence on Apple's behalf is that the Galaxy S featured a curvier look à la the iPhone (original), where as the Galaxy S II morphed into a blockier look à la the iPhone 4.

In short whether Samsung's devices look like Apple's seems largely arbitrary and heavily subject to personal opinions.  Perhaps this is why one European Union court (the Netherlands) recently
rejected these claims as being without merit, while a neighboring court (Germany) upheld the claims and banned sales of Samsung's tablets.

IV. What does Samsung Claim?

Samsung claims that it didn't copy Apple's design and that it's simply giving the market what they want in terms of looks.  And sales figures seem to back that statement to some extent -- the Galaxy S and Galaxy Tab products sold millions of units worldwide.

The South Korean company's infringement claims against Apple stem largely from its deep portfolio of wireless communications patents.  Much like Apple, Samsung is essentially inferring that Apple must broadly alter its product from what the market seemingly demands to bring it out of infringement.

Much as Apple says Samsung cannot make a minimalist tablet, Samsung says Apple cannot make a tablet with wireless communications onboard.

Apple is 
very upset about this claim as many of the patents involved are filed under the "fair, reasonable and non-discriminatory" (F/RAND) principle.  F/RAND applies to patents developed as part of industry standards.  It states that companies must pay you fair licensing fees for the patent, but you must express willingness to license the IP.

By contrast, Samsung is looking to ignore the F/RAND provisions and seek a sales ban -- an identical tactic to Apple's.  The move raises a compelling question of limits F/RAND.  Namely, the question goes something like -- is a company that's broadly looking to kill a F/RAND patent holder's products "unreasonable" and hence subject to licensing refusal?

Again the answer here seems largely subjective.

V. Fallout of the Patent War

If Apple is banned in the Samsung-friendly Korean court it will lose a nice chunk of sales.  SK Telecom Comp., Ltd. (
SEO:017670) and KT Corp. (SEO:030200), South Korea's top two wireless carriers, have collectively sold 3.1 million iPhones -- mostly iPhone 4s.

Thus the loss to Apple would be even greater than the loss Samsung suffered in Germany -- which is expected to see 2.4 million tablet sales this year (of which Samsung was expected to have significant minority stake, before the ban).

So far Samsung has yet to win a case, although the majority of the 23 lawsuits filed internationally between the two companies have not made it to a ruling yet.  However, many believe that Asian courts, such as the South Korean court, will display favoritism towards Samsung, a top local firm.

Samsung is 
appealing the German verdict and hopes soon to strike blows of its own.  Comments the unnamed executive, "If Samsung wins in Germany that will give us a big breakthrough and so will other envisioned efforts against such products as the iPhone 5."

Regardless of who "wins" the patent war, it's likely that the consumers will lose by a reduction of choice in the market.  Some may lose access to the Android tablets or smart phones, while others may miss being able to buy 3G-equipped iPads or iPhones.

Despite this, like some sort of Cold War-gone-awry scenario, Samsung, the largest Android smart phone maker, and Apple, its bitter rival, continue to march along the path to mutually assured destruction.  



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RE: Samsung FTW
By lagomorpha on 9/20/2011 8:58:14 AM , Rating: 2
Unfortunately the average iPhone buyer is stupid enough to buy an iPhone because it's an iPhone even if it can't access 3G speeds. They kept buying them even after they learned they can't make calls right?


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